Prime brokers – typically banks or bank subsidiaries – provide hedge funds with financing for their investments, as well as custodian services. Legal arrangements between hedge funds and their prime brokers vary, but sometimes are structured so that legal ownership of assets rest with the prime broker rather than the hedge fund. With worries about the stability of some banks over the recent credit crisis, some hedge funds have chosen to spread their business among several prime brokers and are shying away from those banks with the highest exposure to the subprime mess. Investors in hedge funds are likely to be more vigilant in the period ahead, in demanding that their hedge fund management vets the prime broker more carefully and adopts measures that better protect hedge fund assets, such as keeping assets in the name of the hedge fund rather than the prime broker.